Jeff Macke
Jeff Macke

TKO Scores a Knockout

TKO Rakes in huge cash for UFC. What I'm doing now.
August 11, 2025
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TKO Scores a Knock-Out! 

TKO signed a $7.7 billion, 7 year deal with Paramount+ to air UFC content, including PPVs. TKO is getting a full price for the asset. Just on the surface, Paramount+ is paying a borderline irresponsible amount of money for UFC.

The deal is "backend weighted" but I'm going to use $1.1b as the amount TKO is getting for UFC. Over the last 3yrs UFC "Media Rights and Content" generated $880 million, $870 million and $794 million in 2024, 2023 and 2022. It's a lot of money but the PPV take has a lot of variability. TKO is getting 15% more than peak-year UFC Media Rights money.

 

I Bought Shares of TKO on the news (up ~4% at $70.50). 

As discussed in last Friday's Video, I've been champing at the bit on TKO. I'm a bit of a weirdo on the business and history of broadcasting fighting events, from closed circuit to PPV. I read about it in my leisure time. (Here's 6,000 words about the economics of Pay-Per-View from my Tumblr page.) Fighting sports are a dicey business. Utterly star dependant and the stars and somewhat erratic young men engaging in a dangerous, unpredictable sport. To make big money you need a huge drawing card involved. That's been true from Muhammed Ali to Mike Tyson to Conor McGregor. Without a big star (or a Sphere) PPV is a monthly crapshoot. 

Trading $1.1b for $880 million peak-year revenue is a good deal, even without the other ways TKO gets paid. I keep saying it because it's true, TKO is selling arms to all the sides in the war for Content between Disney, Paramount+, Netflix, Youtube, Amazon and Apple. It's a nice place to be positioned.

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The Business Model

Some background helps. UFC builds stars and stars sell PPVs. That's the model. UFC 229 was the Ali-Frazier of MMA in terms of audience. Rumored $180 million take on 2.4 million buys. That fight, like 7 of the top 8 PPVs in UFC history featured Conor McGregor.

If another Conor McGregor-level draw emerges TKO will have missed out on some potential upside. If, as rumored Conor McGregor fights at the White House on July 4th it would likely be the most watched (and unhinged) fight in history. Could have done ~$250 million in PPV sales. But that won't happen, both because Conor is never going to fight again and Paramount+ would air the fight for free, on the app and CBS.

$7.7 billion locks in a great deal for UFC. They lock in a steady stream of cash where once there was a 12 PPV events a year with wildly variable payoffs.

The also ends the absurd PPV model (where viewers had to pay as much as $100 for big events), which means a muchlarger audience for UFC. Near as I can tell, TKO still runs the house (meaning takes in the millions a year of ticket sales, concessions, etc). Also wildly variable ($1.5 million to over $20 million per event) but all upside for TKO.

So, yeah, I like the deal. As I explained last week, I was adding TKO "at any opportunity". I don't like paying up but this deal is more than 4% to TKO. So I bought TKO near the open at $170.50. 

 

 

 

 

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